On investing and porn

Stock market has been performing badly. Wall Street goes banana.

It was the banks. Bear Stearns collapsed, Merril Lynch is about to be acquired, and Lehman filed for bankruptcy.

And now it's the insurers. AIG needs a savior.

Investing looks bleak.

Some people say that I work in a safe industry - consumer products. No matter what, people still need to go on with their life. They need to bathe and wash their hair. And people still make babies too.

But there is another industry whose demand never dies, thus ought to be less volatile than technology or banking: porn.

And we can now invest in porn industry. Adult Entertainment Capital, Inc. went public yesterday in NASDAQ, under ADLE ticker.

MSN Money says the porn stocks are worth watching. With yesterday's closing at $0.0065, you can easily be a shareholder.

An article says that it's a big market, around $57 billion globally. Looks like a huge market that can still be exploited...

A classmate once interviewed with Vivid Entertainment for an internship position in finance. The whole school enjoyed his story about the interview.

Can you imagine the experience of attending ADLE's annual shareholder meeting?

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On bullwhip effect

In a supply chain network, (demand) variability increases as orders move upstream. Eventually, the network can oscillate in very large swings as each organization in the supply chain seeks to solve the problem from its own perspective. This phenomenon is known as the bullwhip effect and has been observed across most industries, resulting in increased cost and poorer service.

Among the culprits are demand forecast inaccuracies: everybody in the chain adds a certain percentage to the demand estimates. The result is no visibility of true customer demand.

This phenomenon apparently also applies in life.

Well, how?

It's simply the attempt to impress. Unfortunately, people get inaccurate and unconfirmed information about how to impress. They end up trying many things that they think or assume will work.

This is cascaded down. And further down, with many more assumptions, in the hierarchy. Moving the herds up and down with new assumptions. The swings get bigger each level.

No one wins.

It sucks.

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Joining the Indonesia Global Network

The link to join the LinkedIn group should be:
http://www.linkedin.com/e/gis/48376/79692A0FE65F

68 members in LinkedIn, covering all "regions", except Africa and South America (the closest is Mexico).

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At-the-moment-addiction: Scrabulous

Yup, I have some free time towards the year-end. And I use some of them to play Scrabulous - kind of online Scrabble - on Facebook.

What's good about playing online is that all players need not be online at the same time. You can check how the game progress at any time. Which is also not a so-good thing if you're playing with someone who travels a lot. (this can be mitigated by playing more than one game at a time)

Since we can try words, it's amazing to find out a lot of new "words" out there. Like my friend's favorite, ZA, which doesn't appear in Merriam-Webster dictionary. (it may be defined as South Africa's country code, .za, or a short version of pizza)

Or XU, which means "a coin formerly minted by South Vietnam equivalent to the cent".

Currently, the highest-scoring word listed in the global statistics page on Scrabulous is worth 1,778 points - "OXYPHENBUTAZONE". (as a comparison, my highest scoring game was 305 points.)

Cool, eh?

There are many websites that assist players to find such words, like Scrabulous Dictionary, Scrabble cheat-o-matic, More Words, or WordNavigator. Some consider this as cheating.

Scrabulous was founded two years ago in India, and debuted in Facebook last July. Players can play either on Scrabulous website or on Facebook. While we can play against any friends in Facebook, we can play against anyone on Scrabulous website.

It even sells merchandises online. Like this thong.


Perhaps for some fanatics...

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LCCT, low cost redefined

Some companies really take low cost to the limit. In this case, it's KLIA's LCCT - Low Cost Carrier Terminal.



I wonder why an airport was so overcrowded, chaotic and messy at 5 AM. So bus-terminal-like.

Perhaps there's really a bus terminal somewhere at the back.

After all, the name is Low Cost Carrier Terminal, not Low Cost Air Carrier Terminal. So we should expect any types of carrier at the end of the gates. Bus, cabs, or even becak. And the services that come with it...

And here's how the cost structure is probably like with regards to LCCT and Air Asia:

Standard air fare price

- decent customer service
- knowledgeable airport personnel
+ (more) inefficient passenger flow
- lots of luggage-scanning equipment
+ four times the queue length
- jet bridge
+ umbrellas when it rains

= LCCT air fare

- 10kg baggage
- in-flight food and drinks
- 10cm of leg room

= Air Asia fare

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Holy cow!

This term is not considered to be very popular among teenagers, and most teens claim it is definitely not a very popular phrase. (wikipedia)

Whatever.

But seriously, holy cow! I didn't write (and read) any blogs for the past four weeks. I guess I'm neither a blogoholic nor a blogophile. The truth is, a lot happened and I just naturally decided not to get close to any blog-related activities. It kinda felt good, though :)

Business planning
This was the root cause, definitely. Somehow Asia Pacific region does their business plan just at the start of the 2nd half. Ridiculously way too early. No wonder it has never been accurate. But you know Asians, they like to put a bit too much in their pockets. Anyway, I probably spent too much time given the craps our business partners put in. At the end, though, it seemed to be a big win for Malaysia.

Single life
This has also become a once-a-year routine, during the kids' school holiday in July-August. This year's highlight was sweeping the floor. Having not done it for so long, I found it very difficult to clean just an apartment unit. The area I just swept instantly got dirty again! I felt like Tom, with Jerry kept teasing me... I could've thought about checking the sweeping technique.

24
Finished season 5 and season 6. I feel like I know Jack Bauer inside out.

Negaraku rap
I'm pretty sure tons of blogs out there talked about this short clip by a Malaysian student in Taiwan. I wonder how most Indonesians will react if this was done to Indonesia Raya...

When everybody knows your name
I didn't do much cooking during this period. Two places I visited frequently for the take-away food were Burger King and SOULed OUT - their pizzas are good! Towards the third and fourth visits, the servers and I were like buddies. Well, I doubt they really know my name, but it has reached a different 'level' in my limited social life. To me SOULed OUT is now among places like Prambors Cafe (used to be in Blok M), Champions Cafe (was in Kemang), and O'Hara (this is where RIF used to play) in Bandung. The first two are now history, physically. Not sure about O'Hara...

Sometimes you want to go
Where everybody knows your name,
And they're always glad you came;
You want to be where you can see,
Our troubles are all the same;
You want to be where everybody knows your name.
(Cheers)

Business, not results
Spent an evening with a colleague from Thailand and we agreed that the reason we exist in a corporate is to deliver business, not only results...

Fantasy football and Premiere League
New season has started at Yahoo!Fantasy Sports.

IKEA ads
Tidy up! Some hilarious commercials from IKEA.



Gwen Stefani
Gwen Stefani stopped by in KL, the last city in her Sweet Escape Asian tour, despite protests from student groups in Malaysia, claiming that "the concert would clash with local values". What a great performance from Gwen, and totally different audience (much better than the ones at MLTR's concert)! Most importantly, I feel much, much younger... :)

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The science and business of bra

This is probably one of scientists' wild dreams: mathematical equation to determine new bra-sizing system.

clipped from www.telegraph.co.uk

But now researchers in Hong Kong have come up with a different mathematical equation which they say will produce shapelier outlines and greater comfort for Chinese women. If successful, their bra-sizing system could be adopted across the globe.

Further in the article, a report points out that as many as 70 per cent of women in Britain are wearing the wrong-sized bra as a result of inappropriate categorization of breast size for bras (in the current system - A cup (youthful); B cup (average); C cup (large); and D cup (heavy)). The bra sizes, the researchers say, should be based on a new depth/width ratio (DWR).

The new system is based on 3D geometry, with more than 100 key measurements. It follows 3D scanning of 456 Chinese women. There's a catch, though, in following measurements of Chinese women, because another article also reports that Chinese women need bigger bras due to improved nutritions.

Should we expect a 'boom' in bra business with this perfect-fit type of bra?

In China itself, it is said that underwear market is set to grow 20% a year over 10 years. A report mentions that bras accounted for 56% of the total value of the lingerie market in 2005.

Another brief writes: "28% of respondents said they choose a bra solely on cost, while another 38% said they aggressively seek out deals. Brands that consumers crossed their hearts and said they were most true to included Playtex for fit/comfort, Bestform for pricing and Victoria's Secret for style."

So how true is it?

Take Limited Brands, Inc., the parent company of Victoria Secret. It's share price today is 68% higher than it was exactly five years ago. Total return in five years is a bit lower than that of S&P 500, but not that bad.


You never know how the shareholders meeting is like... perhaps the models of Victoria Secret's will be there... hmm...

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Make the most out of airfares

I came to know this only this week: many airlines (in the U.S.) will refund if the price drops after you bought a ticket.

clipped from online.wsj.com

Few customers realize it, but many airlines will give refunds if they cut the price after you have bought a ticket. Alaska, JetBlue, Southwest, United and US Airways all offer vouchers for the full price difference -- if the price drops $200, you can get a $200 coupon towards a future trip. Others offer vouchers, or cash, after deducting change fees (which can run up to $100). In industry jargon, it is called a "rollover," and in most cases it only works if you bought the ticket directly from the airline. (It generally won't work if you bought them via a Web site such as Expedia.com or Orbitz.com, unless the price drops in the first 24 hours.)

Even though the process is not that straightforward, I would think this helps many people in making purchase decision early - knowing they can get refund if the price drops. Especially with the help of websites like yapta.com.

Customers are the ones who benefit from this, I suppose.

Will the airlines lose their profits (they barely make profits even now) if more and more people claim for refunds (assuming no price increase)?

Logically, they will (lose profits), won't they? But I find it too hard to believe.

The airline yield management is already complicated (yet very interesting). If more customers claim their refunds, it gets more difficult for the airlines to price discriminate. There are more parameters or assumptions to be considered.

That said, some airlines have already made it difficult like change fees. They also have the question whether services like Yapta is a good thing.

What if it is not? They can push the "base" price up, and entertain every single refund nicely. Perceived as "good value" by customers yet still receive the same level of profits. It's all about perception anyway.

Or switch to everyday-low-price style of Wal-Mart (low cost airlines like Southwest still cut prices, if I'm not mistaken). Which would be nearly impossible in the airline industry.

Well, just like gasoline price, I think airplane passengers will still pay high price on average...

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Gasoline price and market

I remember gasoline price in Michigan was below $1 in Summer 1998. Today, it's closing $4.

Commenting Beni's question on how to reduce gasoline price, I argued that the demand must be reduced and let market sets the price. It's all in the customers' hands, and government must facilitate this by providing education and means to promote oil usage.

I was assuming that the oil market is perfect and free. Now, having thought about it again, I think I'm wrong.

(Big) Oil companies today are actually fewer than they were in the past. Exxon and Mobil are now ExxonMobil. And then Chevron, Texaco and Unocal. Conoco and Phillips Petroleum. And so on. I'm not sure about others like Roman Abramovich's Sibneft, Medco, etc. The point is, the big players are not many. Thus the market is not really perfect.

Even worse, I forgot about OPEC. The number one cartel that controls most of oil production and price. It has become the cartel example in any game theory readings.

It seems that we can't really let the market sets the price. So?

Like Beni brought up -- go to the street and shout, or write petition. Or blame the Bush administration.

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Students, MBA, cheating, culture, and disciplinary actions

In the past week, the keyword "Duke MBA cheating" suddenly topped the search coming into this site.

No wonder. On April 26, Fuqua’s Judicial Board, following the procedures set forth in the Honor Code, found 34 members of our first-year class guilty of cheating on a take-home final examination. These students will receive disciplinary actions ranging from expulsion to failing grades.

This incident definitely doesn't help the case of MBA students being the ones who mostly to cheat, a survey found out last November.

A survey of 5,331 students at 32 graduate schools in the United States and Canada found an "alarming" amount of cheating across disciplines, but more among the nation's future business leaders. The study found 56 percent of MBA students acknowledged cheating, compared with 54 percent in engineering, 48 percent in education and 45 percent in law school. The study asked about 13 different types of cheating, ranging from copying a classmate's test answers to lifting sentences from the Internet without attribution.

I agree with the school's decision - to take disciplinary actions and to make it a big deal out of the Honor Code. Cheating is cheating. Incoming students signed the Honor Code. Instructions are typically clear on what students can and can't do during exams or assignments - at least from my experience.

Although I don't have strong opinion on the actions taken, these actions show how serious Duke in not tolerating cheating. I think it's particularly good to incoming students, prospective applicants, and recruiting companies.

Duke has also been continuously informing the 2007 incoming students as well as alumni. The Fuqua Dean confirmed that the students involved were from multiple countries on four different continents.

With no intentions to stereotype, I'm not that surprised international students were involved. I feel that there are many "common" practices, at least in Indonesia, that would've been considered cheating in the U.S. For instance, copying others' assignments. Other practices, like cheating in the in-class exam, also exist (or existed in the 90's).

Two most common cheating practices in this region are probably corruption and bribery. Like copying assignments, they perhaps are more common rather than exceptions. It's like, it's not smart to not corrupt if you get to certain positions. That's THE reason people want to get there. That's probably one of the reasons why people are interested in getting into politics or working for the government.

It will be another long discussion on how to eliminate corruption and bribery. But one thing we can do is to do what Duke did. Consistently and correctly take disciplinary actions to the cheaters.

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Global Services Location Index is (not) Labor Cost Advantage Index?

As I work in supply chain management area, news related to labor costs or outsourcing always interest me. So does "Malaysia ranks 3rd in labor cost advantage index" in recent newspaper.

The more I dug in, though, I feel the title is inaccurate and, potentially, misleading.

Though I read the article in a newspaper, other news websites, like Bernama, NST, and Business Times, are identical.

The study referred to was done by A.T. Kearney, called Global Services Location Index. Its report, "Labor Cost Advantages of "Offshore" Locations Decline in 2006 According to New A.T. Kearney Study", was posted on March 15. The index itself is comprehensive, comprising of 41 measurements in three major categories.

clipped from www.atkearney.com About The 2007 Global Services Location Index The A.T. Kearney Global Services Location Index analyzes the top 50 services locations worldwide against 41 measurements in three major categories: cost, people skills and availability, and business environment. The Index assigns weightings reflecting the drivers of offshoring decisions based on A.T. Kearney research and engagement experience. Because cost advantages have been the primary impetus behind offshoring, financial factors constitute 40 percent of the total Index weight. People skills and availability and business environment each receive a 30 percent weighting.

Malaysia does rank 3rd in overall - considering the three categories: financial, people, and environment. However, Malaysia ranks 21st in financial attractiveness, 19th in people skills & availability, and 14th in business environment. Vietnam tops the financial attractiveness category. See the data behind the 2007 Global Services Location Index here (pdf). A.T. Kearney also provides regional highlights of the study. Indonesia, by the way, ranks 2nd, 14th, and 49th in the same categories respectively.

Unless I'm totally off, i.e. I'm talking about a totally different study, I think it's pretty fair to say the report is somewhat inaccurate, i.e. there's no such Labor Cost Advantage Index. (I hope my words are politically-correct enough to not get me into trouble.)

One explanation of this, I can recall from one of my previous courses, Managerial Effectiveness, is confirmation bias. So I searched my old class notes (it's Sunday, I can do anything I want, right?) on this topic. Here's what the notes say about confirmation bias: the tendency to gather evidence that is consistent with a prior hypothesis. Some of the reasons are (1) laziness, (2) incomplete search, and/or (3) desire to reach a specific conclusion.

"The human understanding, when any proposition has been once laid down... forces everything else to add fresh support and confirmation... it is the peculiar and perpetual error of the human understanding to be more moved and excited by affirmatives than negatives." - Francis Bacon (1620)

Boooring... enough for the theories.

Another interesting example was when one poll was interpreted in two opposite ways: optimistic and pessimistic. Dave nicely put his views on this. I guess, we really are what we think we are.

So this perhaps can explain why Malaysia’s ministers are blogophobic as Unspun brought up, although in this case it's not only for bloggers, but also other official websites.

Well, I might be simply wrong or be “provocative, politically motivated, inaccurate or just floating rumors for the interests of certain parties.”

On the A.T. Kearney study itself, I'll save it for next week... enough study notes for one Sunday...

Source: A.T. Kearney Global Service Location Index 2007

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Indonesia post-oil

In one of his posts, Indonesia an oil-rich country?, Philips, interestingly started the post with his opinion on Playboy Indonesia magazine, cited an interview from Warta Ekonomi about Indonesia's oil reserve - that it will last only for the next 20-25 years.

Even now Indonesia is already a net importer of oil. How will it be 25 years from now? Importing 100% oil requirements? How will it pay?

Is the government aware of this?

But there's a potential solution. Water. More specifically, from the rain.

Indonesia is among the countries that will get more rainfall due to global warming; while other regions will have their rivers, lakes and aquifers depleted. As water availability is very likely to increase, it could be the new oil for Indonesia. Perhaps 25 years from now we can trade water for oil.

Of course, selling water from rainfalls is not straightforward. For the time being, some people have tried this in smaller scale. But if there is a good business case, or a case for survival, it's worthwhile for the government to explore and develop.

So it seems that water could be the 'gold' of the future - especially with rich countries also face the problems of water stress. Even now some people are selling water with premium, like what Jakartass found (scroll down to March 4).

Anyhow, it's still 25 years from now. The government perhaps should think about how to manage the potential flood from the increasing rainfall.

We don't want to end up with no oil and flood, do we?

What's sad is that one major cause of global warming is us burning the fossil fuel - coal, gas, and oil.

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Expensive communication

I find it amazing that it is so expensive to make a call to Indonesia from Malaysia. It's even more expensive than a call to the U.S. -- which takes about 10 more times to travel to (20-hour vs. 2-hour flying). It's MYR 1.80 (~USD 0.50) for a minute to Indonesia, while it costs only half of that to call the U.S. (Telekom Malaysia's (TM) rate)

Of course, there are other countries with more expensive calling rate. Like India at MYR 3.50 a minute. Or Cuba at MYR 5.00 a minute.

The calling rate from the U.S. is no different (except it's cheaper). A call to Indonesia from the U.S. costs USD 0.35 (AT&T) or USD 0.12 (Vonage). A minute to Malaysia is USD 0.22 (AT&T) or USD 0.06 (Vonage). India is USD 0.34 and 0.17 with AT&T and Vonage respectively.

Why is it so expensive to call Indonesia - more expensive than to call Malaysia?

One explanation is monopoly (or duopoly or triopoly, for that matter). But if this is the case, I don't think Malaysia is much different. In fact, TM is probably the only international call carrier in Malaysia.

Or higher initial investment required. The main telecommunication infrastructure difference between the two countries is Indonesia requires more across-islands connection, while Malaysia is pretty much two big areas (West, or peninsular, Malaysia, and East Malaysia). This will also require higher maintenance costs.

Another explanation is high operations costs due to older networks. Though this seems to be a good explanation, I don't have any intelligent information.

It could also be higher operations costs due to other reasons. Like poor efficiency. Or inflated costs. Or pungli. And so on (corruption too).

Or is it merely one of the government's cash cows?

Not to say that these things don't happen in Malaysia. It's just probably not as bad (so the rate can still be lower).

But, with Malaysian telecom companies entering Indonesia (Telekom Malaysia acquired Excelcomindo and Maxis took over PT Natrindo Telepon Seluler), will this change? It's not directly linked to international call rate or settlement rate, but there might be hope.

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On poor customer service

Since last Thursday, we've been trying to open a new account for the kids. All documents were complete. On Thursday, it was an hour waiting to be attended (and no, it didn't get to our turn after an hour). On Friday, it was another 45 minutes, with the banker (customer service representative?) disappeared most of the time, until they said they had a problem.

So I got an earful of complaints from my wife on Friday night. The only mistake, I think, was that she went to a wrong bank, Maybank.

Maybank is the biggest bank and financial group in Malaysia. It is also, however, famous for poor customer service. Unfortunately, I have to bank with Maybank. The company I work at, for the sake of simplicity, only transfers to Maybank. While on one hand it hurts, on the other hand it makes sense as Maybank has the largest network.

I did a search for complaints on Maybank on an online consumer community portal, consumer.com.my. There is quite a few. Some of them, unsurprisingly, I've experienced myself. Like unanswered phone calls. Consistently non-working ATM. Nice (well, sometimes rude) but incompetent employees.

And part of the problem is that they don't focus on customers. They're stuck with the rules. Rules that don't put customers as priority. Many complaints on ATM/card replacement, like this one from the community portal:

Once again... Maybank! Haiz... What the this banking company policy thinking. I had say this company is a d**n lauzy customer services. The story are... Last two week i was get ppl stolen my wallet. Inside all the document and bank card are lost. No choose and i have do the report at nearly polis station, after i went replace all the document and bank card. IC, lisen, OCBC, public bank, RHB, AM ATM card all can be replace after i show them my polis report paper and im tempory IC and internatioal passport. But only the d**n Maybank, i show all the document also my saving book but they say cant! but have orginal IC just will replace the ATM card for me. What? this kind of services also will happening? What the hell they thinking? and i waste about 2 hours and getting this kind answer.

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Kill the messenger!

No one wants to deliver bad news. Particularly to the management. The urban legend is, they will kill the messenger.

That was the mission last Monday - for my boss and me. I was pretty close to having some all nighters. I got sick; probably hoping there would be some empathies to a sick-looking messenger. I broke several promises to the kids. The whole week was just unproductive.

We didn't get killed. In fact, I would consider it a good day as we managed to catch the flight in Singapore despite getting off the presentation just 45 minutes before the departure time. The cab driver was comparable to Queen Latifah in Taxi. I was the last getting into the plane. My boss ran faster than I did. I guess it's time to hit the treadmill.

Penang

So I decided to take the Friday off to Penang with the whole family. Despite the long, four-hour drive, we had a good time. Good food, good fun, and good rest. My third time to Penang, and I'm still amazed that an island of 293 square-kilometers has a 65-storey building. As a comparison, Jakarta's area is 661 square-kilometers and Wisma BNI 46 is 48-stories.

I was probably the only United fan in the hotel bar. I'm pretty sure I was the only one jumping when O'Shea scored the goal, and also the only one left watching the post-game analysis. Whatever, it was a good game - for United.

Fire incident

Got a call from our neighbor on Sunday morning - bitching that we were still sleeping in Penang. One of the units on the ground floor of our condo building was on fire. Everyone was evacuated through the stairs, at 2 AM. Except my Iranian neighbor who decided to keep on sleeping (probably there were some others).

The fire was extinguished without any fire trucks entering the complex. Apparently, everyone found out last night, the building entrance is too small for the fire trucks.

Additional checklist the next time we move: is the building entrance big enough for fire trucks?

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Indexes drop and computer power

Major market indexes were down quite significantly, it seems, on Tuesday. Dow Jones closed 3.3% lower, while S&P500 and Nasdaq dropped 3.5% and 3.9% respectively.

For Dow Jones, particularly, a computer problem contributed to the speed of the drop.

It started with huge trading volume -- computer calculation lagged -- switched to backup system -- correction (~an hour of trading reported in seconds) -- market panicked.

Ouch.

The malfunction in the oldest, most established benchmark for U.S. stock prices shows how a technical fault can worsen a market decline.

"I don't think it would have been as bad had there not been some technology issues,'' said Kenneth Polcari, a managing director at ICAP Plc's equities unit who has traded at the New York Stock Exchange for more than 25 years. "The technology issues created some anxiety, which exacerbated the market's move.'' (Bloomberg)

I wonder if someone will soon sue for the loss...

The story from LA Times:

Dow Jones' troubles started about 2 p.m. Eastern time when computer systems were apparently overwhelmed by trading volume, causing the calculation of the widely watched industrial average and other Dow Jones indexes to lag behind trading, spokeswoman Sybille Reitz said.

Once Dow Jones realized that the indexes were lagging — that is, not properly reporting the extent of the market's decline in real time — executives notified the exchanges by phone.

About 3 p.m., Reitz said, Dow Jones switched from its primary server to a backup system, which rapidly caught up with the trading. The result was that an extended period of trading, perhaps the better part of an hour, was reported to the market in a matter of seconds, she said, making it appear as though the Dow Jones industrial average had lost nearly 200 points almost instantaneously. At one moment, the Dow seemed to be down about 280 points; when traders glanced back at their screens, it was down more than 450 points.

That seemingly unprecedented swoon apparently sparked some panic selling that in turn caused a logjam at the NYSE and other markets amid a high volume of trades.

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2007 Super Bowl

I heard the Indiana Colts won the Super Bowl, beating the Chicago Bears 29-17. But Super Bowl is really not about the game, isn't it? It's the commercials and half-time entertainment.

Remember Janet Jackson in 2004? (Don't worry, the link is to Wikipedia)

Past commercials like Reebok's the Office Linebacker or Visa's Yo or Levi's Crazy Legs are pretty cool and popular. And if I'm not mistaken, some of those commercials were made and aired during Super Bowl only. Hang on, this one's cool too: FedEx's Caveman.

For this year, my favorite is Bud Light's Rock, Paper, Scissors.

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Earn it like Beckham

So Beckham got a deal with LA Galaxy worth, potentially, US $ 250 million for five years. That's the total package if everything goes as planned -- $50 million in salary, $50 million in club profits, $50 million in shirt sale merchandising, and $100 million from sponsors. Or around that, lah.

Seems to be a lot of money. It is, actually, compared to other soccer players in the U.S. The $50 million salary for five years is approximately $200 thousand a week or about 102 thousand Pounds (shoot, I don't know how to type the Pound sign). The second-highest paid player in the MLS earned $1.3 million in 2006, while the average salary for a squad player is $32,000 per year, not week.

That's pretty much on par with other top soccer players in the European league. Roy Keane, for example, earned 90,000 Pounds per week while at Manchester United, while Shevchenko receives around 130,000 sitting on Chelsea's bench. In Spain, Ronaldinho's annual salary is US $11.4 million.

So, apparently the salary itself is not that eye-popping. It's the remaining of the package. It's Beckham's brand equity.

But how about the rest of the industry?

I did a quick google on CEO's salary. Well, they probably are laughing now as people are making a fuss over Beckham's package. A typical total CEO take-home compensation comprises of salary, bonuses, stocks and incentives, and stock options. Most of the pays were in stock options gain. The typical CEO salary itself was ranging from zero to about $2 million.

Here are some examples how much companies paid their CEOs in 2005 (total compensation -- excluding "other compensation" such as personal use of company aircraft). Disney - $10 million. GE - $18 million. American Express - $28 million. Goldman Sachs - $45 million.

Still below Beckham's annual $50 million total package. Try this: Dell - $67 million. Oracle - $92 million.

Capital One Financial even paid its CEO to the extreme: $280 million of total compensation with $0 salary and $0 bonus.

So, wanna earn it like Beckham, or stay in the corporate way?

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Foreign Workers

There is a lot of Indonesians in Malaysia. Most of them are low-skilled workers like maids and construction workers.

Low-skilled foreign workers account for an estimated 20% (15% are legal) of Malaysia's total workforce as per recent article in New Straits Times about chaos without foreign workers. They work in security, constructions, factories, restaurants, plantations and other industries. Of course, also as maids. They come from many countries too: Vietnam, Bangladesh, Philippines, India, and Myanmar.

Foreign workers let "local" workforce to pursue higher value activities that can contribute to, presumably, better economic returns for themselves and the country. On the other hand, these foreign workers are cheaper too. For instance, local workforce will cost construction 30% more.

It's good opportunities too for the foreign workers. They make much better living than they do in their home countries.

But, what is it for the "exporting" countries? Will these workers add values when they come back? Will the gap between the exporting country and the importing country get bigger?

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Cashless society - all plastics

While doing my 2004 summer internship in Jacksonville, Florida, my colleague shared her passion and belief about cashless society: all monetary transactions should be done with "plastic".

My experience of not carrying cash in the U.S. was good. Most shops and services accept credit cards, brick-and-mortar as well as online. Colleges and universities also promote this idea by consolidating everything into the student cards. Getting a credit card is also easy, for good and bad.

Experience in Asia, especially in Malaysia and Indonesia, however, hasn't been that good. Many shops still don't accept credit card - mostly the traditional shops and services, which are a lot in these countries. Even some big stores - electronics, watches, etc. - charge the interchange (or merchant service) fee, about 2-3% to customers.

Credit card thefts, or frauds, also seem to be more frequent in these two countries. Although I have no data, I have more friends worrying about using their credit cards or doing online transactions here in Malaysia and Indonesia. Perhaps it's the not-yet-matured infrastructure that gives more rooms for crimes.

I once was a victim of credit card fraud in the U.S. But my experience dealing with the bank to cancel the transaction was so much easier than dealing with renewing my credit card here in Malaysia. It could be the bank, but definitely it's the customer service problem in Asia.

It seems to me that the main 'challenge' to cashless society in Indonesia or Malaysia is culture. Business owners still prefer cash, hard cash. Though true, cash is king, I'd still assume that accepting credit cards brings other benefits. Despite the charges and risk of fraud, a merchant should be entitled to these benefits: potential sales increase, cash security (by not storing much cash in the store), financial management, etc.

I ain't working for bank nor am I an employee of Visa, MasterCard, Amex, etc. I just don't like to have a thick wallet. I'm a supporter of cashless society.

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